Bloomberg:
- Merkel Looks East for Austerity Allies in Talks With Hollande. German Chancellor Angela Merkel is turning east as she pushes plans for a more competitive Europe, seeking to bring on board the leaders of Poland and other eastern countries as allies elsewhere prove hard to find. Merkel and French President Francois Hollande, the key players in the euro-area debt crisis, travel to Warsaw today for talks on closer European Union integration with Polish Prime Minister Donald Tusk and his peers from the Czech Republic, Slovakia and Hungary. The six leaders are due to hold a joint news conference at about 4 p.m. Warsaw time.
- Merkel’s Working Poor Pose Election-Year Dilemma as Divide Grows. Every Saturday, about a hundred people arrive in a silent procession at a small church in the north of Berlin, armed with empty shopping carts. Some smoke, others play with their children as they wait patiently to be called for the packets of noodles, vegetables and cans of soup that are handed out. They are Germany’s poor, come for out-of-date food that has been collected from supermarkets by the Laib und Seele charity. “It’s scary, nearly every week more people sign up who can’t make ends meet,” Antje Grund, a local coordinator for the charity, said in a Feb. 23 interview while preparing some of the 900 kilograms (2,000 pounds) of food that are doled out each week. “There are pensioners and unemployed, but even people who have a job and a regular income come to us to get food.”
- Chavez Legacy of Polarized Venezuela Endangers Smooth Transition. Venezuela faces political infighting and the risk of unrest after the death of Hugo Chavez, whose personal brand of socialism left the region’s biggest oil exporter polarized and among the world’s most violent countries. As government control of the economy spread, Chavez’s critics blamed the nationalization of more than 1,000 companies or their assets, currency controls and price caps for discouraging investment, creating food shortages and fueling inflation. The former paratrooper’s departure after 14 years in office opens up a void, even after the cancer-stricken leader in December urged supporters to elect Vice President Nicolas Maduro to succeed him if he couldn’t fulfill a term that began Jan. 10.
- China Agrees to Additional UN Sanctions on North Korea. North Korea and its ruling elite are facing additional sanctions after the U.S. and China agreed on a United Nations Security Council resolution punishing the Communist nation for its February nuclear test explosion. U.S. Ambassador to the UN Susan Rice announced the agreement yesterday after a meeting of the council, which plans to adopt the measure with a vote later this week. Russia, which like China has veto-power, also supports the sanctions, Russian UN Ambassador Vitaly Churkin said in comments reported by the RIA news agency.
- Rubber Trades Near Two-Month Low on Demand Outlook Concerns. Rubber futures traded close to the lowest level in more than two months as investors remained cautious about demand growth prospects. The contract for delivery in August dropped as much as 0.4 percent to 286.4 yen a kilogram ($3,074 a metric ton) and was at 287 yen on the Tokyo Commodity Exchange at 12:17 p.m. local time. Futures closed at 283.9 yen on March 4, the lowest since Dec. 20.
- Traders Flee Asia Hedge Funds as Job Haven Turns Dead End. Paul Smith moved from London to Hong Kong to work in Asia’s hedge-fund industry almost 17 years ago, and he rode the boom to its peak. Last year, like other industry veterans, he quit. “I decided not to wait the cycle out but to do something more productive with my time,” said Smith, 53, who remains in the city heading the Asia-Pacific office of the nonprofit CFA Institute, the global association of chartered financial analysts. “The hedge-fund industry in Asia will continue to struggle to raise funds for the next few years as banks continue to have liquidity issues.”
- Sharp Said in Talks for 10 Billion Yen Samsung Investment. Sharp Corp. (6753), the unprofitable Japanese electronics maker, is in talks to obtain an investment of about 10 billion yen ($107 million) from Samsung Electronics Co. (005930), according to two people familiar with the situation.
- Venezuela Leader Chávez Dies at 58. Hugo Chávez, a former tank commander turned populist politician who used Venezuela's oil riches to challenge the U.S. with his fiery brand of socialism, died Tuesday from complications related to cancer. With Mr. Chávez just months into his fourth term, his death plunged Venezuela into political uncertainty. The foreign minister said Mr. Maduro, as expected, would take over for Mr. Chávez until an election is held within 30 days. But some in the ruling party disputed that, saying it should be the head of the assembly. The Supreme Court declined to immediately weigh in on the controversy.
- ADP CFO: Companies Accelerated Bonuses at Year-End to Lower Taxes. Companies heavily accelerated bonuses and payroll at the end of last year to avoid higher tax rates on personal income in 2013, a move which could take a bite out of overall wage growth figures this year, according to Automatic Data Processing Inc. Chief Financial Officer Jan Siegmund. When the Commerce Department in January said bonus payments that were shifted into 2012 from this year helped push personal income in the U.S. 2.6% higher in December, it confirmed what Mr. Siegmund had known was coming for months.
- New York City Leads Jump in Homeless. An average of more than 50,000 people slept each night in New York City's homeless shelters for the first time in January, a record that underscores an unsettling national trend: a rising number of families without permanent housing. Families have become a larger share of the nation's homeless population, growing 1.4% from 2011 to 2012, after their numbers fell as the economy emerged from recession. In Boston, authorities said there were 1,166 homeless families in December 2012, up 7.8% from the previous year. In Washington, D.C., homeless families grew 18% from 2011 to 2012, according to the U.S. Department of Housing and Urban Development. The numbers in New York, however, are starker, according to a report to be published Tuesday by the Coalition for the Homeless, a New York advocacy group, citing New York City government figures. More than 21,000 children—an unprecedented 1% of the city's youth—slept each night in a city shelter in January, an increase of 22% in the past year, the report said, while homeless families now spend more than a year in a shelter, on average, for the first time since 1987. In January, an average of 11,984 homeless families slept in shelters each night, a rise of 18% from a year earlier.
- White House Asked Gensler to Stay at CFTC. The Obama administration has asked Gary Gensler to serve a second term as the U.S.'s top futures-industry regulator, according to people familiar with the matter. The question now is whether Mr. Gensler will say yes. Mr. Gensler, who heard from the White House in January, hasn't decided whether he will stay as chairman of the Commodity Futures Trading Commission. Instead, he is interested in taking on a role as a senior economic official elsewhere in the administration, these people say.
- Fed Holds Ground on 'Stress Test' Releases. Banks Argued Against the New Plan to Issue Results in Two Components, a Week Apart, Citing Possible Stock Volatility. Large U.S. banks and the Federal Reserve are clashing over the two-part "stress test" release schedule adopted this year, in the latest flash point between large financial institutions and their overseers. A conference call last week between Fed officers and bank representatives ended with the central bank refusing to accommodate demands from some lenders for a one-day release of results, according to a person briefed on the call.
- Copper Market Prepares for a Flood. Price of the Industrial Metal Has Plunged Amid Forecasts of the Biggest Increase in Output in 13 Years. The copper market is bracing for a wave of new mine openings this year. Copper prices recently fell to three-month lows as investors and traders anticipate an onslaught of supplies, estimated to be the biggest increase in global copper mine output in 13 years. At the same time, the outlook for growth in copper demand remains dim: The No. 2 and No. 3 users of the industrial metal, Europe and the U.S., continue to face economic headwinds.
- #SequesterThis. Meat inspectors have to go, but fine wines are still on the USDA menu. In its bid to make the sequester as painful as possible, the White House announced Tuesday that it is canceling all visitor tours of the White House "during the popular Spring touring season." This fits President Obama's political strategy to punish the eighth graders visiting from Illinois instead of, say, the employees of the Agriculture Department who will attend a California conference sipping "exceptional local wines" and sampling "tasty dishes" prepared by "special guest chefs."
- Obama administration hit for giving Egypt $250M as domestic spending cuts take hold. The Obama administration is facing criticism for giving $250 million in aid to Egypt while saying the recent sequester has forced drastic cutbacks elsewhere in the budget -- including forcing the release of "low-priority" illegal immigrants from jail.
- Oil Industry Mulls Next Steps for Venezuela. Venezuelan President Hugo Chavez's death is not likely to result in near-term changes to the Venezuelan oil industry or global energy landscape, but it could ultimately result in political change that would reopen the country's energy industry to foreign investment.
- Paulson's Gold Fund Limps Forward. Gold is up 70 percent since hedge-fund manager John Paulson turned bullish in the spring of 2009. So why has Paulson & Co.'s dedicated gold fund suffered double digit declines?
- Europe Is Drowning Under Too Much Government. (graphs)
- QE Is "Unsustainable And Unfair To Those Who Work For A Living".
- Today's Other All Time High: Smith And Wesson(SWHC) Gun Sales.
- Janet Napolitano Dazed And Confused About What Sequester Really Means.
- The NINJAs Are Back: Buy Life Insurance, Get A No Doc Mortgage Loan For Free.
- Dear American: It's An "Extraordinary Circumstance" And This Drone's Coming For You.
- Six Bizarre Taxes That Congress Could Pass This Year.
- DEMOCRATIC CONGRESSMAN: Hugo Chavez Was 'Committed To Empowering The Powerless'.
- THE BIG EASY: Here's Jeff Gundlach's Huge New Presentation On Government Intervention And The State Of World Markets.
- White House Report On Sequester Cuts Will Make You Sick.
- LAKSHMAN ACHUTHAN: Look At These Charts And Tell Me We're Not In Recession.
- EMERGING MARKETS-Brazilian stocks fall on rates speculation.
- Unpaid bills, pensions loom large in new Illinois budget. Illinois Governor Pat Quinn will unveil a fiscal 2014 budget on Wednesday that will chip away at a huge pile of overdue bills and cut spending to accommodate growing public pension costs, top state officials said on Tuesday.
- Google(GOOG) tests same-day delivery, raising marketplace speculation. Google Inc began testing a same-day delivery service with retailers in recent weeks, the latest move into Amazon.com Inc's e-commerce turf by the world's largest Internet search company. Google Shopping Express helps local retail stores sell products online and have the items delivered to shoppers the same day, according to a person familiar with the test.
- Italy president mulls new technocrat government-sources. President Giorgio Napolitano is considering appointing a new technocrat government led by a non-politician as one way out of Italy's political stalemate, Italian officials said on Tuesday. Such a solution would come into play if centre-left leader Pier Luigi Bersani failed to form a government after receiving an initial mandate from Napolitano, as is expected, they said.
- The gap between rich and poor will continue to grow until we give up on QE.
- Cypriot crisis deepens as 'haircut' fears drive capital flight. Capital flight from Cyprus has accelerated since eurozone politicians began threatening losses for bank depositors, and may have reached 12pc of the country's GDP over the last month.
- Centaline Founder Says Hong Kong Property Curbs 'Last Straw'. Shih Wing Ching said the latest round of property measures is the "last straw to break the camel's back" and will lead to "big adjustments" in prices. Transaction volumes may fall by half, Shih said.
- Dry Cargo Bulk Shippers to Remain Under Pressure. China Merchants Group Chairman Fu Yuning says he doesn't expect the problem of excess capacity to be resolved this year.
- The China Banking Regulatory Commission will issue new rules on housing loans following property curbs announced last Friday by the State Council, citing Chairman Shang Fulin.
- China Should Use Property Tax to Curb Speculation. Property control suppresses prices, preventing it from rising too quickly which will impact macroeconomic and social stability, citing a commentary by Mei Xinyu, a researcher with the Ministry of Commerce.
Oppenheimer:
- Rated (UPS) Outperform, target $95.
- Rated (FDX) Outperform, target $124.
- Asian equity indices are +.25% to +1.0% on average.
- Asia Ex-Japan Investment Grade CDS Index 106.0 -3.5 basis points.
- Asia Pacific Sovereign CDS Index 84.0 -1.0 basis point.
- FTSE-100 futures -.05%.
- S&P 500 futures +.05%.
- NASDAQ 100 futures unch.
Earnings of Note
Company/Estimate
- (AEO)/.56
- (BF/B)/.70
- (PETM)/1.21
- (DYN)/-.46
- (SPLS)/.45
- (TFM)/.44
- (BIG)/1.98
- (KFY)/.29
- (HOV)/-.10
8:15 am EST
- The ADP Employment Change for February is estimated to fall to 170K versus 192K in January.
- Factory Orders for January are estimated to fall -2.2% versus a +1.8% gain in December.
- Bloomberg consensus estimates call for a weekly crude oil inventory build of +788,000 barrels versus a +1,130,000 barrel gain the prior week. Gasoline supplies are estimated to fall by -1,000,000 barrels versus a -1,857,000 barrel decline the prior week. Distillate inventories are estimated to fall by -1,000,000 barrels versus a +557,000 barrel gain the prior week. Finally, Refinery Utilization is estimated to rise by +.4% versus a +2.2% gain the prior week.
- Fed's Beige Book
- None of note
- The Fed's Fisher speaking, Fed's Plosser speaking, Eurozone gdp report, Canadian rate decision, weekly MBA mortgage applications report, Cowen Healthcare Conference, Wedbush Tech/Media/Telecom Conference, (HON) investor conference and the (XOM) analyst meeting could also impact trading today.
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